Category: Ethernet Services

Conference Season Fall 2012

The Fall 2012 Conference and Trade Show season is about to ramp up and many of us will hit the road shortly to begin the rounds.  Around this time we field a fairly steady of questions about the “best” conferences to attend.  “Best” is, of course, highly subjective and, depending on one’s objectives, there are a number of excellent shows to attend that will hit this mark.  Rather than attempting to discuss each of the conferences coming up, we’ll be presenting some insights in a series of blogs on the ones we’ll be attending.  Here’s a quick run down on some of the conferences we’ll be attending this Fall and that may be of interest to readers:

Feel free to post the conferences you’ll be attending and any particular insights you’d like to share on them.  Fellow readers will appreciate it.

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Microwave backhaul underestimated in fiber’s shadow

“Backhaul requires a fiber fix,” this video tells us, a sentiment echoed by its subject: no less an authority on fiber than an executive from a backhaul provider with fiber in its name.

But while fiber is front and center in wireless backhaul requirements, wireless microwave technologies are also often required to reach cell sites that can’t cost-effectively be reached by fiber. You may not hear as much about it because companies that use a mix of fiber and microwave — like Allied Fiber and Intellifiber — don’t put the word “microwave” in their names and prefer to be known for their most prized product. Quietly, though, it’s a sizable chunk of the backhaul space: Southeastern backhaul provider TowerCloud, for example, serves 80% of its sites with fiber and 20% with microwave.

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Fiber rollouts fuel rise of Ethernet backhaul

A quarterly update from Zayo Group today gives a refreshed view of technology trends in wireless backhaul. More than 60% of Zayo’s fiber-to-the-tower revenue in the June quarter came from Ethernet services, having been less than 40% in the same quarter last year.

It’s another sign of how quickly Ethernet is penetrating the backhaul market. Just three years ago, despite widespread recognition of Ethernet’s benefits in this application, there was also widespread reluctance to use it for several reasons. Today Ethernet is becoming mainstream in backhaul networks, and mobile operators are even starting to use Ethernet exchanges.

One historical obstacle to Ethernet adoption in backhaul has been the relative scarcity of fiber at cell sites, a condition that is rapidly being reversed as 4G deployments fuel wireless bandwidth demand.  As Zayo’s Ethernet mix grew from roughly 40% to 60% of backhaul revenue over the course of a year, the number of towers it serves with fiber jumped nearly 90% — to 1,978 in the June quarter, with another 500 under construction. As fiber continues to proliferate, so will Ethernet. What will the charts look like a year from now?

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Masergy’s next moves

Masergy is looking for acquisitions to beef up its bottom line following the new injection of capital it will receive from being acquired by private equity firm ABRY Partners. As it’s shopping, the provider of global VPNs and MPLS services would do well to add hosted VoIP and other cloud services to its in-house capabilities, emulating the strategy of several others including Cbeyond (CBEY), which last year acquired both a cloud computing firm and a hosted VoIP provider.

Masergy made the case fairly well for combining its own services with hosted VoIP in the press release announcing its partnership with hosted VoIP provider Thinking Phone Networks: When you blend the benefits of a cloud-based application with the performance quality and QoS controls of a secure, intelligent MPLS connection, you have a powerful package. (Throw in SIP trunking, and customers have a way to get the most of their existing premise-based PBXs.)

But wait, you say: Doesn’t Masergy mainly serve large businesses? What do large businesses want with hosted VoIP? Isn’t that just for small businesses that don’t have their own dedicated IT staff?

On the contrary. Hosted VoIP is not just for small businesses anymore. As I detail in a new report just recently made available (“Hosted Business VoIP: UpMarket Opportunities”), demand for hosted VoIP services is quickly catching fire among businesses with hundreds or thousands of employees.

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How to feed the next bandwidth hogs

As network operators point to the rising bandwidth consumption of mere websites in general as a mounting challenge, it’s worth stepping back from time to time to see what bandwidth management challenges might be coming down the road. Here’s just one example that came to mind this week:

The rock band U2 is taking 360-degree “gigapixel” pictures of the audiences on its current tour. The entire audience. Take a look; you can scan the front row, the back row and everything in between. (You may have seen similar ultrahigh-resolution images from Barack Obama’s inauguration or the 26-billion-pixel picture of Paris, both of which are essentially fusions of multiple images.)

Audience photos in general are becoming more popular because even standard-resolution photos at smaller venues are being uploaded to Facebook, where the audience members can “tag” themselves. For concert-goers, it adds another social layer of value to the experience, since it allows them to connect with one another  – for example, by sending a message to another audience member: “Hey, you were that girl banging your head near center stage! Remember when the drummer passed out? Wanna get a beer sometime?” For the bands, it can be an amazingly rich marketing resource, a way to easily contact fans (to alert them of future events – new albums, etc.) and a source of demographic, geographic and social information about them.

As these practices become more popular, imagine the next step.

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Will Ethernet exchanges be threatened by direct handoff hubs?

As startup Ethernet Exchanges continue to ramp up, most discussions of them include the caveat that this market, which sprang up less than two years ago, is still young and its future is therefore hard to predict. That already muddy view of the sector gets a bit muddier as more carriers add another variation to the model by launching their own Ethernet interconnect services independent of third-party exchanges, as two more carriers did last week. Will carrier hubs eventually diminish the need for third-party exchanges?

Let’s back up a moment.

The idea behind Ethernet exchanges is this: To hand off Ethernet services from your network to mine, you and I have to sit down and hammer out a pretty complicated agreement about how precisely to do it. If I have three tiers of service quality and you have five, we have to agree on things like whether your mid-tier service is more like my number 2 or my number 3 and how to translate service characteristics and performance monitoring from one network to the other, etc. It’s a long, complicated process.

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Beyond megabits: Defining broadband value in the cloud era

When telecom service provider executives talk about the importance of selling “solutions” rather than just bandwidth, it’s more than just a matter of semantics. Although much of the marketing and pricing of telecom services has historically fixated on broadband speeds, that approach fails to convey the real value that telecom carriers provide, and it will become increasingly less apt going forward.

Source: FCC

When business users were asked in a recent FCC survey how fast their broadband connection was, a majority (54%) said they didn’t know. That was generally true across various business sizes;  54% of small businesses and 47% of everyone else said the same thing. How compelling can a 20-Mbps or 50-Mbps offering be to users who don’t know (and evidently don’t much care) how many Mbps they currently consume?

Source: FCC

When you look at these services from the user’s perspective, a different picture of value emerges. Businesses that are planning to upgrade to faster service within the next year told the conductors of this same survey that the biggest reason they are doing so is to support new applications (56% cited it as a major reason, and 24% cited it as a minor reason).

Despite years of Speed-War marketing, many business users still don’t have an intuitive grasp of how fast their broadband is. What matters most to them, rather, is

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Ultrabroadband Ethernet service for businesses

Adtran (ADTN) has been talking about its forthcoming Ultra-Broadband Ethernet (UBE) platform mostly in terms of residential markets. But how applicable is to business services?

First, the basics: Functionally, UBE is like an improved version of fiber-to-the-curb. It delivers 100-Mbps symmetrical Ethernet over 300 feet of existing twisted copper (just one pair, no bonding), saving carriers the expense of stringing fiber all the way to the home. Instead fiber is provisioned to small nodes, serving up to 8 customers each, that are deployed on telephone poles and in streetside cabinets. In addition to using existing copper plant, Adtran says these nodes are small enough to be inserted, in many cases, inside existing neighborhood boxes.

1108E ONU for UBE

Notably, those fiber-fed field nodes are powered by the customer, using a self-installed CPE that plugs into a phone jack in the home. Its power consumption is shared among the subscribers using it and, at under 10 watts per customer when all ports are active, should be negligible on user utility bills – comparable to a child’s nightlight, Adtran says.

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Videoconferencing’s next killer app

For years, videoconferencing vendors reminded us of the high price and inconvenience of air travel. Expensive fares, lost time, communication blackouts – these were unacceptable impediments that videoconferencing would cure.  

These days, though, vendors are pushing collaboration, more than airplane replacement, as videoconferencing’s killer app, arguing that, as one vendor recently told me, the market for enterprise collaboration is 10 times the size of the videoconferencing market and should adapt accordingly. (It’s a sentiment that I’m sure you’d hear at the Collaboration Partner Summit Cisco [NASDAQ:CSCO] kicked off today.)

The collaboration pitch is similar to the old airplane-replacement pitch in at least one respect: In both cases, you’re mostly selling increased productivity. But while we could all stand to be more efficient (even this parenthetic phrase is preventing you from getting back to your own work sooner), productivity has already been boosted pretty far by the recession’s layoffs and belt-tightening.

However, here’s a pain point exacerbated by the bad economy that videoconferencing can directly address:

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Masergy: An inside look

Masergy Communications filed the paperwork for an initial public offering on Friday, catching the wave of increasing demand for hosted and managed telecom and IT services among businesses and allowing a newly detailed look into the service provider’s ten-year-old business.

Masergy sells a mix of data communication and IT services to a global audience of enterprises, so its IPO will help it compete against the likes of Verizon Business, AT&T, BT Group, Global Crossing and Tata Communications. At this point, in terms of annual revenue, even Global Crossing is about 25 times Masergy’s size. But in terms of reach, Masergy has built out an impressive footprint: Its global network serves 3900 customer locations in 49 countries, with network operations centers in Plano, Texas and London. Fifteen of its 27 network hubs are inside the United States.

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